Without the accounting charge, the tableware maker would have been in the black for the quarter and year.
Although it had what amounts to a loss on paper, Libbey Inc. said yesterday it was pleased with its fourth-quarter and annual financial performance last year and is in position to have an excellent 2008.
"I like the cards that we are holding," company Chief Executive Officer John Meier told industry analysts in a conference call.
For 2007, the Toledo tableware maker had a loss of $2 million, or 16 cents a share, compared with a loss of $21 million, or $1.47 a share, in 2006. Revenues were $814 million, up from $689 million the year before.
In the fourth quarter, the company had a loss of $5 million, or 34 cents a share, compared with a loss of $8.5 million, or 60 cents a share, a year earlier. It had revenues of $225 million, up from $213 million.
But the official results didn't tell the entire story.
Libbey's fourth-quarter sales were up 6 percent and annual sales were up 18 percent.
But U.S. accounting rules prompted the company to record a noncash tax charge of $15 million. The charge related to assets the company had set up as tax deductions, but then, because of accounting rules, had to be written off the financial books.
Without the charge, Libbey would have had a profit of $10 million profit for the quarter and $13 million for the year.
"It just takes the assets off our books, there's no real impact," said Ken Boerger, vice president and treasurer.
Of greater significance, he said, was that the company's international sales rose 28 percent.
Investors apparently liked the report. Libbey stock rose $1.11 a share to finish at $15.58 on the New York Stock Exchange.
Analysts liked the performance also.
Douglas Lane, of Jefferies & Co. of Boston, said in a report that the firm beat quarterly sales expectations and profits before taxes and other factors.
"On balance, business appears on track although there appears to be some softness in the core food-service glass business which is offset by unexpected strength elsewhere, particularly retail and international," Mr. Lane wrote. He suggested buying Libbey stock.
Mr. Meier, the CEO, said the prospects for this year look good in Europe. A major German competitor recently got out of the business, leaving just Libbey and rivals from France and Turkey.
At a recent trade show in Frankfurt, Germany, Libbey's products were extremely well received, he said.
"I've been at this show every year since 1974. This would rank as Libbey's finest showing," the company leader said.
He said he expects the Toledo firm's first-quarter sales to be $185 million to $190 million and its 2008 sales $850 million to $870 million.
Contact Jon Chavez at:
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